Bitcoin (BTC) is one of the first cryptocurrencies to rise to popularity. Invented in 2008, it is now the largest cryptocurrency by market share. As of June 2017, BTC has a market cap of nearly $40 billion. The only other cryptocurrency to come close to this is Ethereum.
As a cryptocurrency, Bitcoin is a store of value that is becoming more and more generally accepted. Online stores and eCommerce businesses are becoming more likely to accept BTC for payment. There are also brick and mortar stores that have taken to accepting the cryptocurrency.
Where to Buy Bitcoin?
You can purchase and invest in BTC through the following means:
1. Centralized Crypto Exchanges (CEX)
The most common way to buy Bitcoin is through a Centralized Crypto Exchange or CEX. A centralized crypto exchange acts similarly to a stock exchange and acts as an intermediary between buyers and sellers to trade many different types of other cryptocurrencies and other digital assets such as NFTs.
2. Decentralized Exchanges (DEX)
A decentralized exchange is another type of exchange that allows peer-to-peer transactions directly from your digital wallet without going through an intermediary. Examples of DEXs include Uniswap, PancakeSwap, dYdX, and Kyber.
3. Crypto Brokers
Another place to buy Bitcoin is through a Crypto Broker. Examples of Crypto Brokers are BlockFi, Robinhood, Voyager, and SoFi. Crypto Brokers act similarly to stockbrokers. Crypto Brokers act as intermediaries and allow a buyer to place an order through the broker to buy their desired cryptocurrency. This method allows for a very simple experience in buying cryptocurrency, but fees may be higher.
As more people accept BTC as an accepted form of payment, its value increases. There is a fixed supply of Bitcoin in the market. In fact, the blockchain network and protocols that support BTC state that there can only ever be 21 million BTC in existence. It is expected that all available Bitcoin will circulate into the market by 2140. Because of this fixed nature, Bitcoin’s value is heavily affected by demand.
Bitcoin’s value is currently quite volatile. Much like stocks, it is affected by news in the market. As of mid-2017, there are talks of regulating BTC in certain countries. Because of this, and the expectation of reduced liquidity, BTC’s value has been stagnating compared to its past rallies. As of press date, BTC trades at approximately $2,490 per BTC.
Alternatives to Bitcoin
Because of the growing popularity of BTC, several new cryptocurrencies have been created to attempt to penetrate the market. BTC’s strongest competitor is Ethereum, followed by other cryptocurrencies known as alternative coins, or Altcoins.
We hope you’ve enjoyed reading CFI’s guide to Bitcoin. To learn more, check out the following CFI resources: